iPhone SE 3 could help deliver Apple’s first $199 iPhone

The iPhone SE 3 is expected to arrive in about a week at Apple’s first press conference of the year. That’s what the rumors say, claiming that the iPhone maker will also unveil additional hardware alongside the new iPhone SE. The budget-friendly $399 iPhone SE 2 is already selling very well, and it’s one of the best picks in this price range. But the iPhone SE 3 could help Apple give buyers the first-ever $199 iPhone.

It’s an iPhone price we haven’t seen in years since carriers scrapped subsidies. At the time, the typical iPhone entry price was $199, but that wasn’t the actual price of the handset. That’s what you had to pay upfront for the iPhone when signing a new two-year contract. But $199 would be the full price of the iPhone SE this time around, no contract required.

Why the mid-range iPhone is so exciting

We’ve already explained that the $399 iPhone is a nightmare for Android phone makers. It is one of the best-selling devices in this price range.

Indeed, unlike its Android counterparts, the iPhone SE offers flagship hardware and performance. The only thing stopping the iPhone SE 2 from doing more damage is the outdated design of the iPhone. The phone has a much smaller screen than a mid-range phone which is not as powerful as the iPhone SE. But specs matter.

When the iPhone SE launched in 2020, the handset featured the same chip as all current-generation iPhone 11 models. As we’ve seen recently, the older iPhone 11 outperforms the brand new Galaxy S22 in benchmark tests. The iPhone SE 3 that Apple will unveil in a few days will feature the A15 chip that powers the iPhone 13 series.

Unlike previous iPhone SE models, the iPhone SE 3 will also offer 5G connectivity. That makes that $399 entry price even more exciting than before.

But how do you go from there to a $199 iPhone SE 3? It is complicated.

Apple won’t price the iPhone SE 3 at $199. The most likely starting price is $399, just like the current model. Apple kept the iPhone 12 pricing structure in place for the iPhone 13, so we expect the same strategy for the next-gen iPhone SE. But there is speculation that Apple might do things differently.

Apps on the home screen of an iPhone 11 Pro smartphone. Image source: Zach Epstein for BGR

The $199 iPhone SE deal

First, Loop Capital Markets analyst John Donovan said he’s heard rumors that the iPhone SE could start at $300. If so, buyers would receive a starting price of $299 for the latest version of the iPhone SE.

It’s there that Bloomberg’s Mark Gurman enters. He made a deal in his Light up newsletter that Apple should continue to sell the iPhone SE 2 once the third generation model arrives. Apple could sell the 2020 version for $199, while the new model starts at $299 or even $399.

Apple wouldn’t profit from selling the $199 iPhone SE, with Gurman suggesting another path to profit. The cheaper handset could bring more users to iOS and the ecosystem of digital products sold by Apple. This would increase revenue from Apple services. Additionally, iPhone users can purchase other Apple devices that work with iPhone, such as AirPods or Apple Watch.

Keeping the iPhone SE 2 in its lineup alongside an iPhone SE 3 with the same design would make sense. Apple is still selling the iPhone 11 in stores, which starts at $499 for the 64GB version. Again, this $199 iPhone SE 2 is practically an iPhone 11 inside an iPhone 8 body.

That said, we’re only looking at speculation at this time. Apple is expected to unveil the iPhone SE 3 on March 8. That’s when we’ll know exactly how much Apple will charge for the handset and whether the iPhone SE 2 will remain in the company’s lineup.

About Franklin Cheatham

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